Industry growth rebounds, but still low

The country’s industrial output grew by 4.8 per cent year-on-year in September, up from the previous month’s abysmal 1.42 per cent, but still sharply lower that previous year’s growth rate of 7.4 per cent for the same month.

The country’s industrial output grew by 4.8 per cent year-on-year in September, up from the previous month’s abysmal 1.42 per cent, but still sharply lower that previous year’s growth rate of 7.4 per cent for the same month.

A poor performance by the manufacturing sector, that grew by 4.8 per cent in September, pulled down the overall growth rate of Index of Industrial Production (IIP), raising concerns about a slowdown in factory output growth in wake of the global economic downturn.

Finance Minister P Chidambaram, however, described the growth rate as encouraging.

“After the poor results reported for the month of August 2008, the quick estimates of IIP for September 2008 are more encouraging.”

Chidambaram said growth in capital goods sector at 18.8 per cent was impressive and that in consumer goods was satisfactory, as was the rise in output from mining and power sectors.

India Inc, beset with rising input and borrowing costs, said there was a slowdown in manufacturing activity and sought more liquidity infusion measures to spur growth.